SBA ends loan eligibility for legal permanent residents

A closed sign for a business | Photo by Pete Jelliffe, Flickr

The Small Business Administration updated the loan program guidance stating it will no longer accept applications from legal permanent residents directly impacting businesses owned by non-U.S. citizens, the agency announced Feb. 2. Previously, legal permanent residents were eligible for SBA loans, which served as a source of capital for small businesses seeking to start or expand their operations. 

This policy change marks a significant shift in federal lending eligibility. Prior ruling, LPR’s were eligible to hold 100% of ownership of the business. The new SBA policy notice can be found here. 

This change comes from the Executive Order 14159 “Protecting the American People Against Invasion” signed by President Donald Trump on Jan. 20. This executive order emphasizes the threats, security and safety that aliens have abused at the expense of the American people. 

The policy change also raises questions about the potential economic impact it may have. As it affects the access to federal lending programs, limiting the resources of those who have met legal requirements and complied with federal guidelines.

While the policy change creates uncertainty for many, having their own business represents the American Dream. It reflects their hard work and dedication to be able to be independent and provide for themselves and their family. Also, while contributing to their community by creating jobs, goods and services. 

Although LPR’s will continue to contribute to the economy, they are left to prepare for this new chapter in financing unless the SBA decides to make any updates or changes to the guidance. 

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